Senate Republican Leader Mitch McConnell offered an olive branch to Democrats over the payroll tax cut, calling for a short-term extension—what Democrats have advocated—while Senate Majority Leader Harry Reid agrees to negotiate a year-long extension through a conference committee.
"House Republicans sensibly want greater certainty about the duration of these provisions, while Senate Democrats want more time to negotiate the terms," McConnell said in a statement from his office. "These goals are not mutually exclusive."
McConnell's statement came minutes after Boehner and House Republicans dug in their heels against the idea of a short-term fix, claiming it would be dangerous for the economy.
"A two month extension only perpetuates the uncertainty that too many employers already have in dealing with the economy and what's coming out of Washington," Boehner said. While aides have said that McConnell spoke to Boehner before issuing the statement, Boehner hasn't said whether he'll take the deal.
Democrats pointed to the statement as further proof that the GOP's stance was slipping. President Obama mentioned McConnell's proposal in an afternoon televised statement, claiming it showed that Senate Republicans agreed with his position.
"Democrats agree with the Republican leader of the Senate," Obama said. "We should go ahead and get this done."
One Senate Democratic aide highlighted the rift between the House and Senate.
"It's pretty enormous," the aide says. "When was the last time McConnell broke with Boehner?"
The aide also dismissed the procedural concession—for Reid to agree to a conference committee to craft a year-long bill—as only a skin-deep giveaway.
"Even if a conference committee happens, it's going to be a sideshow. The real policy is going to be worked out through other channels," the Democratic aide says.
The payroll tax cut will expire on January 1 unless Congress acts. In addition, unemployment benefits will begin to run out for those who have been jobless for more than a half-year, and reimbursement rates for Medicare doctors will plummet.
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